Corn and soybean prices fell in Chicago as optimism about a trade resolution faded once again. Despite speculation that the Trump administration was moving toward a deal with the Chinese government to end tariffs, many traders saw this session as a way to take gains off the table.

A “not-so-shocking” announcement came from the Trump administration today on tariffs. In addition, markets largely ignored news that the Federal Reserve was keeping interest rates at current levels. Wall Street expects that the central bank will raise interest rates at least one more time in 2018.

Here’s what else you need to know from the Chicago Board of Trade.

Soybean Prices Lose Steam

Soybean prices retreated in Chicago as markets reacted to speculation that President Trump may hit China with tariffs on another 25% on $200 billion on imports.

September soybean contracts slumped 17.25 cents to close at $8.915. The November contract fell 17.5 cents ended the day a tick under $9.02.

That’s a sharp reversal after yesterday’s gains. The Trump administration appears to be floating a trial balloon to see how the markets would react to potential tariffs. That made yesterday’s rally — fueled by two unknown sources to Bloomberg – a little too good to be true.

Meanwhile, the USDA released the Fats and Oils report for the month of June. The average analyst projection was 168.8 million bushels for the June crush. The average oil stocks estimate sat at 2.272 billion pounds.

But, the crush estimate easily beat expectations. The USDA said that the June crush came in at a monthly record of 169.9 mbu.

Tomorrow, we’re looking for weekly updates on exports for both old crop and new crop. We’re seeing old crop sales estimates range between 150,000 MT and 500,000 MT. New crop estimates range between 300,000 and 700,000 MT.

Wheat Prices Push Higher on Weather News

September SRW prices pushed higher today. The September contract added 4.5 cents to close just above $5.58. December SRW wheat prices added 5.5 cents to close just under $5.79.

As Brennan discussed in this morning’s Breakfast Brief, markets are keeping a close eye on Europe, where German farmers are demanding about 1 billion euros ($1.18 billion USD) in aid to address crop damage. Meanwhile, Spain experienced temperatures in the range of 118 degrees Fahrenheit (48 degrees Celsius). As the wheat crop continues to cook in the hot summer sun, we’re expecting some downward revisions when the USDA releases its August WASDE report next Friday.

Get our complete coverage of the August WASDE report and where we see prices moving this month.

In Kansas City, September HRW prices gained 7.25 cents on the day to finish at $6.08. The December contract added 7 cents to close just above $5.91.

Spring wheat prices for September added 1.75 cents to finish just under $5.64.

December MGEX contracts gained 3.25 cents to close at $6.26.

Tomorrow, we’ll be digging into the weekly crop sales numbers. Analysts project that wheat sales for the week will come in somewhere between 200,000 MT and 450,000 MT.

Corn Prices Slump

September corn contracts slumped 7.25 cents to close at $3.65. The December corn contract fell 7 cents to close at $3.795 per bushel.

Today, the focus was on ethanol production from the Energy Information Administration. The energy agency said that U.S. production slumped 10,000 barrels per day. Average production for the week ending July 27 came in a 1.064 million barrels per day.

Tomorrow, we’ll be starting our day with weekly corn exports figures from the USDA. Ahead of this report, we’re seeing old crop sales estimates between 300,000 and 600,000 MT. New crop estimates range between 400,000 and 800,000 MT for the week ending July 26.

Earn More Money for Your Grain

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Be sure to sign up for the daily Breakfast Brief. Each morning, FarmLead President and CEO Brennan Turner offers readers a look inside the numbers to break down what is moving grain prices across the continent.

We’re not just talking exchanges in Chicago and Winnipeg.

We’re talking about local prices on some commodities with limited price transparency and liquidity all across the continent. If you’re growing flax, lentils, oats, and more, we’ve got you covered.

Garrett Baldwin is a content strategist and editor at FarmLead. He covers the global grain markets and public policy issues related to the agricultural industry. He is a graduate of the Medill School of Journalism at Northwestern University. He also holds a Master’s Degree in Economic Policy from The Johns Hopkins University, an MS in Agricultural Economics from Purdue University, and an MBA in Finance from Indiana University.

Grain markets this morning are almost all green as U.S. grain prices are seeing the benefit from a weaker U.S. Dollar, but that’s also pushing other currencies higher, including the Canadian Loonie and Brazilian Real.